Departing from an electricity schedule is not, by itself, proof of having harmed the system. FERC's February 7 uplift proposal recognizes that a market participant's deviation can help meet system needs. The ethical question is whether a charge follows a reasonably expected contribution to cost, rather than treating every difference as a failure deserving payment. [2017-02332][2016-30971]

Where regional operators already allocate real-time uplift to deviations, the proposal would connect charges to cost causation and offset harmful deviations with helpful ones hourly. It would not compel operators using other allocation methods to adopt deviation charging. The defined deviations exclude changes linked to economic or reliability dispatch instructions, preserving a distinction between discretionary differences and responses to system direction. [2017-02332][2016-30971]

Understanding responsibility also requires knowing what is measured. Proposed payment disclosures use dollars; operator-initiated commitments use megawatts; deviations use megawatt-hours. These are not competing estimates of one quantity. The distinction makes it possible to ask separately what action was taken, what energy differed from schedule and what compensation followed. [2017-02332][2016-30971]

The December fast-start proposal raises a related but different fairness issue: reflecting eligible resource offers in prices. Its definition requires startup within ten minutes, minimum run time no longer than one hour and an economic energy offer. Neither proposal guarantees a resource will set prices or that customers will save money. Our judgment is that fair allocation and reliable service belong in the same discussion, without presenting a proposed mechanism as an achieved public benefit. [2017-02332][2016-30971]

Source documents

  1. Uplift Cost Allocation and Transparency in Markets Operated by Regional Transmission Organizations and Independent System Operatorshttps://www.govinfo.gov/content/pkg/FR-2017-02-07/html/2017-02332.htm
  2. Fast-Start Pricing in Markets Operated by Regional Transmission Organizations and Independent System Operatorshttps://www.govinfo.gov/content/pkg/FR-2016-12-30/html/2016-30971.htm